Australia poised to reap benefit through decade of AI-driven growth: PwC Research

• Trustworthy AI adoption could boost global GDP by 15 per cent by 2035, with Asia Pacific one of the strongest growth regions.  

• Industries are reconfiguring to form new domains of growth, fuelled by trusted AI productivity uplift and decarbonisation efforts. In 2025 alone, AUD $11.1 trillion (USD $7.1 trillion) will change hands as businesses look for new ways to attract and retain market share.  

• Landmark research published as PwC outlines new strategy to support people and clients in an era of disruption.

Australia – New research published by PwC reveals that trusted AI has the potential to boost economic output in the Asia Pacific region by 14.7 per cent over the next decade – on par with growth rates last seen during the 19th century industrial revolution. 

Globally, the GDP increase could be nearly 15 per cent, effectively adding more than a percentage point to current annual growth rates. PwC’s report, titled Value in Motion, is based on data-driven scenario analysis which reveals that the global growth dividend from AI is not guaranteed and depends on more than just technical success – it also hinges on responsible deployment, clear governance and public and organisational trust. In other scenarios analysed by PwC, characterised by lower trust and co-operation, the incremental boost to the economy from AI would be more muted at 8 per cent, or in a pessimistic scenario just 1 per cent.

PwC Australia Chief Economist, Amy Lomas, says this research quantifies the opportunity for Australian businesses and the need for a rapid uptake of responsible, trusted AI.  

“Getting the balance right between going fast and building trust in these new platforms will be critical. It’s less about the technology itself and more about how individual organisations engage with it and embed it. We will only reap the rewards if we have the scaffolding in place to trust the technology on a global scale,” she said.

“Australia has more to gain than most – we have the combined pressures of an especially tight labour market; a dramatic shift in our working age population; vulnerability to the physical climate risks of fire, flood, storms and heat; and significant growth in human services demand – primarily aged, health and disabilities care.   

“Collectively these forces mean boosting growth and unleashing productivity is a critical part of the equation. That means being a leader in our approach to AI, not a not a laggard,” she said.  

Industries to reconfigure for human needs   

The analysis also finds that a rapid reconfiguration of the economy is underway, leading to the formation of new ‘domains’ that cross traditional sector lines. These domains will focus on a set of basic human needs, such as how we move, feed, build and make. It will see businesses operate across multiple domains, for example, the rise of electric vehicles is bringing electricity providers, battery manufacturers, tech firms and others into the ‘mobility’ domain, enabling them to create value alongside automobile manufacturers.

As this rapid reconfiguration takes place, AUD $11.1 trillion (USD $7.1 trillion) in business revenue could shift between companies this year alone, driven by the efforts of businesses to fundamentally alter how they create and deliver value in response to evolving market conditions.  

“In the Asia Pacific region, we will see AUD $4.7 trillion change hands as global megatrends collide and industries reconfigure. How we fuel society, move, feed and care for ourselves and build and make things are all in state of flux,” said Lomas. 

PwC Australia’s Chief Clients and Markets Officer, Tom Gunson, said this represents an historic opportunity for Australian businesses to shift where they derive wealth and tilt our economy towards more agile and innovative outputs.  

“It’s an existential question – can a nation whose success was built on extraction, exporting and traditional finance shift fast enough to compete in a global economy where value is increasingly intangible? What can businesses do to ensure they are not outpaced by countries that turn sustainability and digital intelligence into the next industrial engines?

“These growth dynamics, and the magnitude of the value at stake, mean that companies will have to innovate their business, operating and energy models rapidly. This will impact how we connect and compute, how we fund and insure, even how we govern and serve, to enable the transformation ahead.”

According to PwC’s 28th Annual Global CEO Survey, only a third of Australian CEOs have a high degree of trust in AI and they feel less exposed to technological disruptions than their overseas counterparts. They are also more confident in their current operating models, with 74 per cent saying their business will be economically viable in the next decade if it continues on its current path.  

“These statistics suggest Australian business leaders don’t feel the same sense of urgency as their global counterparts. Given the size of the prize available, it’s time to shift that thinking and consider how these global trends will reconfigure our industries, and where new value is emerging.  

“Australia has the raw ingredients to lead in this new era, but leadership will depend on adopting a mindset that seizes the opportunities ahead while managing the risks. The next wave of growth won’t come from how much we dig or ship – but from how we meet human needs,” said Gunson.  

Climate impact

PwC’s research shows that while AI is set to accelerate growth, the costs of physical climate threats will impose economic constraints. The Insurance Council of Australia estimates that extreme weather costs have more than doubled in the past five years, reaching an average of $4.5 billion annually, largely due to rising flood costs. PwC’s economic modelling suggests that physical climate impacts could leave the global economy nearly 7 per cent smaller by 2035 in all scenarios than it would have been otherwise. 

Increased AI adoption is expected to lead to increased energy use by data centres. However, modest use of AI to drive energy efficiency could offset this increased use of energy. PwC estimates that the energy use and emissions impact of AI would be neutral if each additional percentage point of AI use led to innovations which cut energy intensity by just 0.1 per cent.

Notes to Editors  

About PwC’s Value in Motion research 

PwC’s methodology for assessing the future impacts of AI and climate change is a comprehensive, multi-step approach combining qualitative scenario development with quantitative modelling and expert insights. The baseline growth scenario assumes a "business-as-usual" trajectory using Shared Socioeconomic Pathway GDP predictions, adjusted to exclude AI impacts for separate analysis. Physical climate risk adjustments are made based on external academic research, estimating GDP reductions due to climate threats. The AI model evaluates different levels of AI adoption and net task change and their economic impacts, while the Climate Transition Risk Model assesses the costs of transitioning to a net-zero economy using an integrated assessment model. The outputs from these models are combined in a master economic model to project global and regional macroeconomic impacts. The Climate-AI Interaction Model independently examines interactions between AI adoption, energy use, and emissions. Sector-domain mapping translates sector outputs into broader economic domains, while the BMR Pressure Index and Value at Stake research efforts assess the pressure on companies to reinvent their business models and quantify potential revenue shifts. The full findings can be accessed here.